Motor policy indemnity refused for kidnap and assault by insured using insured vehicle (US)

Patrick Bracher, Norton Rose Fulbright

A Montana Supreme Court rejected an extraordinary claim by the insured who had kidnapped, physically assaulted, threatened, restrained and injured his estranged wife using the insured vehicle in the course of the kidnap.  The court had no difficulty in finding that the insured’s conduct was not accidental for the purposes of the policy and that the damages suffered by the estranged wife were not payable because she was a named insured.

The policy covered loss caused by an “accident” arising from ownership or use of the insured vehicle.  An “accident” was defined to mean “a sudden, unexpected and unintended occurrence”.  The policy specifically excluded coverage where an insured intentionally caused bodily injury or the bodily injury was reasonably expected to result from an insured’s intentional or criminal acts.  The event was not an accident, it was intentional, and the consequences were expected.  In addition, the exclusion of coverage for damages payable to a named insured under one of the policies excluded any cover for the victim, named under the policy.

In the course of the judgment, the court rightly said “There is nothing unusual about a policy that requires the insured to read the exclusion section, the definition section, and the declaration page to determine the scope of coverage”.

21^st Century North America Insurance Co v Kevin R Frost DA 22/0073 in the Montana Supreme Court

First published by: Financial Institutions Legal Snapshot